Millionaires have strong philanthropic tendencies, yet gave less in 2010 than they did in 2009.
The downward shift is part of the mixed and changing world of charitable donations. Overall, giving remained level in 2010 and is expected to rise this year, though the nature of giving continues to evolve.
“U.S. nonprofits saw a slight improvement in giving in the first nine months of 2010, although it hasn’t been enough to help many nonprofits that are grappling with staff and/or service cuts even as demand for their services has increase,” said the Nonprofit Research Collaborative in a press release announcing a recent survey of charities.
Historically, giving falls with the stock market and increases one-third as fast as the stock market, said Sparxoo, a market research firm. This trend explains the 6 percent drop in charitable giving in 2009 and gives credibility to expectations that charitable giving will increase in 2011.
Millionaires surveyed by Spectrem Group gave an average of $5,080 in 2010 down from $6,392 in 2009. The average contribution fell, yet a high percentage of Millionaires – 96 percent – continue to give to charity. About 65 percent of all U.S. households give to charity with an average annual contribution of $2,213, according to Sparxoo.
More than three-fourths of the millionaires gave $1,000 to $9,999 in 2010, and 16 percent gave $10,000 to $24,999. Two percent gave $25,000 or more.
The Millionaires, who have a net worth of $1 million to $5 million not including their primary residence, gave time as well as money. They donated an average of 137 hours to charity each year with 29 percent giving less than 40 hours a year and 30 percent giving 41 to 50 hours a year.
Millionaires younger than 55 are most likely to contribute lower amounts of money, while investors over 66 are most likely to give large amounts of time. Thirty percent of investors 66 and older gave 101 or more hours to charity last year. Senior corporate executives are the most charitable with 57 percent giving $5,000 or more a year and more than one-third donating 101 or more hours a year.
Continuing a trend online giving is expected to account for a greater percentage of donations, according to a recent report by The Blackbaud Index of Online Giving. Online giving increased 34.5 percent since last year with the largest charities reporting a 55.6 percent increase in online donations. Online donations now make up an average of 7.6 of donations received.
The earthquake in Haiti prompted a spike in online giving that resulted in 18.4 percent of 2010 online donations being made in January. Year-end giving taking place in October, November and December accounted for 31.3 percent of online giving for 2010, Blackbaud reported.
Larger charities were more likely to report an increase in donations, the Nonprofit Research Collaborative said.
“Younger, less well-established nonprofits have been especially hard hit by the recession. Many foundations, seeking to maximize more limited resources, have steered their grant making toward organizations they believe have the best chance to weather the economic storm.”
Nearly half the organizations responding to the NRC survey said they expected donations to increase in 2011 and one-third expected donations to stay level and 20 percent expected to have a smaller budget this year.